Potential Risk Class (PRC) matrix
A matrix classifying all debt schemes by maximum interest rate risk, measured by Macaulay Duration, and maximum credit risk, measured by Credit Risk Value — disclosing the maximum risk the fund manager may take.
This one is not written up yet
The definition above is the short version. A full explanation — how it works, a worked example and the exam traps — is still being written. In the meantime the chapter below covers it in context.
Written up from the same chapter
- Corporate Debt Market Development FundA close-ended Category I AIF, formed as a trust with a 15-year tenure, that buys investment-grade corporate bonds from debt mutual fund schemes when SEBI declares a market dislocation.
- Execution only platformA SEBI-recognised digital platform that carries out subscription, redemption and switch transactions in direct plans of mutual fund schemes only — registered with AMFI (Category 1) or as a stock broker (Category 2).
- SCORESSEBI's centralised web-based system for processing investor complaints, on which the company or intermediary must upload an Action Taken Report and the investor can watch the status online.
- Segregated portfolioA ring-fenced sub-portfolio holding the debt instrument hit by a credit event, split out of a scheme so that the good assets stay liquid and exiting investors cannot leave the damaged paper behind.
- Total Return IndexThe variant of a market index that adds the dividends and interest paid by its constituents to their price movement — the only variant a mutual fund scheme may be benchmarked against since 1 February 2018.
Where this is taught
- Series V-D · Chapter 4: Legal and Regulatory Frameworkintroduced here
- Series V-A · Chapter 4: Legal and Regulatory Frameworkintroduced here
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